Avis to Buy Car-Sharing Service Zipcar

By

John Kell

Updated Jan. 2, 2013 1:13 p.m. ET

Car-sharing service Zipcar Inc. changed the car-rental business, but its hourly rentals to young and urban customers proved a lousy business.

The Cambridge, Mass.-based company signed up more than 760,000 members since its founding in 2000 but struggled to post a consistent profit. On Wednesday, Zipcar agreed to sell itself to Avis Budget Group Inc. for about $500 million, or $12.25 a share, well above its recent trading price but...